The House of People’s Representatives (HPR) approved a $738.2 million loan agreement for South Sudan during its fourth regular session yesterday. The loan will facilitate the construction of a 220-kilometer road, creating a connection between Ethiopia and South Sudan, as reported by Addis Standard.

The South Sudanese parliament had previously approved this agreement in June with the aim of strengthening bilateral relations and economic ties between the two countries.

Despite facing significant challenges, including a serious humanitarian crisis, war, high poverty rates, and shortage of foreign exchange, Ethiopia’s economic situation remains dire. High-ranking civil servants struggle to afford basic needs, over 4.5 million displaced persons are in urgent need of assistance, and the country’s youth face high rates of unemployment.

According to the 2024 UNOCHA report, Ethiopia requires US$3.2 billion in funding to provide humanitarian assistance to 15.5 million Ethiopians impacted by conflict, climate shocks, and internal displacement. The report highlights the urgent need for additional resources to address food insecurity and deliver critical services to affected populations.

UNICEF has also been active in providing essential healthcare services to over 900,000 people in regions affected by drought and war. To continue this vital work, UNICEF requires US$535 million in funding to support refugee children, adolescents, and families. However, as of September 2024, there remains a 78% funding gap, emphasizing the need for increased support to avert further crisis.

Meanwhile, civil servants in Tigray have not received their unpaid salaries for 20 months. The government has yet to pay them, citing a budget shortfall. The post-war humanitarian crisis in Tigray has escalated to a critical level. Additionally, investors in Tigray are compelled to pay interest on loans for periods when they could not operate due to the war.